Registering a company in Poti (Georgia) - YB Case 2024

Registering a company in Poti (Georgia)

Poti (Georgia)
Registering a company in the Poti Free Industrial Zone (FIZ) in Georgia is a strategic move for international investors due to its significant benefits and modernization efforts. Here's an overview of FIZ Poti and the advantages it offers to entrepreneurs.

Overview of FIZ Poti

FIZ Poti is strategically situated within the Port of Poti, one of the Black Sea's largest ports with excellent logistics infrastructure. The port's connectivity to Georgia's railway network and neighboring countries makes it a crucial transit hub for goods traveling between Central Asia, the Caspian Sea, China, and Europe.

Ongoing modernization efforts, including the construction of a new deepwater terminal, have expanded the port's capacity to handle larger ships and increased cargo. This modernization makes FIZ Poti an attractive platform for entrepreneurs looking to develop international businesses.

Benefits for investors in FIZ Poti

Investors who choose to register a company in the Poti Free Industrial Zone can enjoy several tax advantages, including:

  • 0% import duties on all types of goods imported into the zone,
  • 0% VAT on all goods and services produced and consumed within the zone,
  • 0% corporate income tax on profits earned in FIZ Poti,
  • 0% tax on dividends paid by companies in the zone to their shareholders,
  • 20% tax on personal income received in FIZ Poti,
  • no property tax for registered companies in FIZ Poti.

Companies registered in FIZ Poti can also:

  • repatriate capital to any country worldwide without restrictions,
  • earn tax-free interest on their investments,
  • receive royalties for licenses and patents without incurring taxes.
FIZ Poti's impressive track record includes creating over 10,000 jobs and attracting over $1 billion in investments. It has become a hub for companies from more than 20 countries, including the USA, China, Turkey, and the UAE. In 2023, the number of registered companies increased by 15% compared to the previous year, and exports reached $1.5 billion, marking a 20% growth over 2022.

These statistics underscore the attractiveness and economic vitality of the Poti Free Industrial Zone in Georgia.

Opening a company in Poti, Georgia: step by step

To create a company in FIZ Poti, Georgia, you need to follow several steps. Below, we provide a detailed description of the process.

Step 1:

Choose your business type and structure

  • Decide on the type and structure of your business. Options include LLC, JSC, general or limited partnership, or branch registration. Each has its advantages and disadvantages. But registering an LLC in Poti is more popular among foreign investors. While JSC provides greater flexibility in business processes.
Step 2:

Register a unique business name

  • Submit various versions of the company name for approval to the competent authority. Once approved, you will receive a certificate of registration for the company name.
Step 3:

Gather the necessary documents

Gather the necessary documents according to your chosen corporate form. This nomenclature usually includes:

  • registration certificate,
  • charter,
  • passport of the company director,
  • power of attorney if the application to open an account is submitted by someone besides the head of the company.
Step 4:

Register your company

Register a company in the House of Justice of Georgia with a legal address in FIZ Poti. Receive confirmation of registration from Poti FIZ regulators.

Actions after registration:

  • open a bank account in Georgia at one of the largest banks in Georgia (TBC Bank, Bank of Georgia, InvestBank Georgia, Bank Republic, and Liberty Bank);
  • obtain the necessary licenses for your business by submitting applications and necessary documents to the relevant authority;
  • complete other post-registration requirements, such as registration with tax and social security authorities and obtaining permits from local authorities.
It is noteworthy that when registering a company in the Poti Free Industrial Zone, the physical presence of founders or directors is not required. Specialized companies, such as ours, accompany the process of registering a company in Georgia, including representation in local authorities and institutions. This support can simplify the registration of your company in the Georgian FIZ Poti, making the process simpler and more efficient.

Which industries offer prospects for business development?

Poti has created an attractive environment for businesses in various industries, providing strategic advantages and operational benefits. We have collected here the main benefits that various types of businesses can receive from registering in the Poti FIZ.

  1. Mechanical engineering:
    1. an ideal location for the production and assembly of mechanical components;
    2. access to the Poti port and railway network for efficient logistics;
    3. tax benefits and a simplified registration process.
  2. Chemical and food industries:
    1. Tax benefits, including zero import duties and zero VAT on goods and services produced and consumed in the zone;
    2. lower operating expenses and incentives for growth.
  3. Logistics and transport:
    1. strategic location in the port of Poti, a major Black Sea port;
    2. access to the railway network for the smooth movement of goods;
    3. optimization of international trade operations.
  4. Agricultural enterprises:
    1. zero taxes and a favorable business environment for agribusiness expansion;
    2. opportunities to develop new markets.
  5. Innovation and research:
    1. government support for start-ups and innovative projects;
    2. infrastructure and tax incentives support data centers, research and development, and technology innovation.
  6. Green energy:
    1. subsidies for renewable energy projects and in line with global trends in sustainable development;
    2. opportunities for solar, hydroelectric, and wind energy initiatives.
FIZ Poti offers various facilities to meet various business needs, including land plots, equipped warehouses, office space, and logistics facilities.

These combined benefits make the Poti Free Industrial Zone in Georgia an attractive location for businesses across various industries, promoting growth, innovation, and international success.

What to expect from remote company registration services in Georgia

Business consulting firms like YB Case offer comprehensive company registration services in Georgia and around the world, including legal and administrative support. They go beyond the legal aspect and offer administrative support. They can help you navigate the process and advise you on the best business structure for your needs.

Engaging a service provider to handle the remote registration of your company in Georgia typically involves several key steps:

  1. Consultation and planning. The process begins with an in-depth consultation to understand your business requirements, objectives, and the type of company structure you wish to establish. Based on this information, the service provider will advise you on the most suitable legal structure.
  2. Document preparation. Service providers will assist you in preparing all the necessary documents for company registration. This includes drafting articles of association, securing required permits, and ensuring all relevant paperwork is in order.
  3. Approval of the company name. They'll help you select a unique company name and submit it for approval by the relevant government authorities. Once approved, you'll receive a certificate of registration for your company name.
  4. Registration with authorities. The service provider will present all the required documents to the appropriate Georgian government bodies to officially register your company. This includes submitting legal documents, identification cards, and other necessary forms.
  5. Banking. They will help you legally secure the status of the company and set up banking processes in Georgia.
  6. Tax compliance. The service provider will ensure that your company complies with Georgian tax laws by obtaining an identification number and registering for VAT, if applicable.
  7. Permits and licensing. If your business requires specific permits or licenses, the service provider will assist in obtaining them.
  8. Company stamp. They'll help you acquire an official company stamp, a requirement for conducting business transactions in Georgia.
  9. Ongoing compliance. Once your company is registered, the service provider will guide you through continuous requirements, such as annual reporting and tax obligations.
  10. Support and maintenance. A reliable service provider will offer ongoing support and advice, assisting you in navigating changes in legislation or adapting to evolving business needs.

Throughout this entire process, the service provider serves as your local representative, communicating with government authorities on your behalf and ensuring all requirements are met.

When selecting a service provider, it's crucial to conduct due diligence. Look for reputable firms with experience helping foreign investors; check customer reviews and references; and ensure they have a strong understanding of Georgian regulations and your specific business requirements. Additionally, inquire about the fees associated with their services. Professional assistance streamlines the registration process, minimizes common errors, and guarantees that your company complies with Georgian laws and regulations.

Key points to know before registering a foreign company in Georgia

  • Language. Although English is often used in business transactions, it is useful to speak Georgian or hire a translator for official documents and interactions with local authorities.
  • Immigration and work permits. If you plan to hire foreign employees working in Georgia, review the immigration and work permit requirements for foreign workers. Different rules may apply depending on the nationality and position of your employees.
  • Intellectual property protection. Make sure your intellectual property, including trademarks and patents, is properly protected in Georgia. Consider registering trademarks to protect your brand.
  • Commercial lease agreements. If you need a physical office or commercial space in Georgia, carefully review and enter into lease agreements. Pay attention to the conditions, rental rates, and maintenance responsibilities of the property.
  • Cultural awareness. Familiarize yourself with Georgian business culture and etiquette. In Georgia, it is important to build relationships and conduct business in a culturally sensitive manner.
  • Local partnership. Depending on your business goals, you may want to consider partnering with local companies or individuals. Local partners can provide valuable information and connections in the Georgian market.
  • Business insurance. Explore business insurance options to protect your company and assets. Insurance can help reduce the risks associated with various aspects of your business.
  • Exit strategy. Think through your exit strategy. While you're focused on starting your business, it's smart to plan how you can sell or exit the business in the future if necessary.
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